Inflation across food items in India has led to a greater price hike in vegetarian thalis than non-vegetarian thalis, affecting vegetarian families more, according to a new study.
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What the report says
The nation has been reeling through a wave of record-high inflation, most reflective in the wild fluctuation of tomato prices, alongside other food items. According to a recent study, these price hikes might be affecting vegetarian households more than their non-vegetarian counterparts by observing the prices of a single “thali” meal. The price of a vegetarian thali has risen by 24.26% to 33.8 rupees while the price of a non-vegetarian thali has gone up by 12.54% to 67.3 rupees when compared to their respective prices nearly a year ago.
According to Crisil, the organization behind the report, since one would have to pay 6.6 rupees more for a vegetarian thali now, a family of five would be shelling out an extra 33 rupees, paying 37.5 rupees extra if preparing a non-veg thali one time a day, for either lunch or dinner. If they were to prepare a thali two times a day, say for both lunch and dinner, the additional burden would surmount to 1980 rupees for 5 veg thalis, and 2250 rupees for non-vegetarian thalis over a month.
RBI statistics stated that a rural male farmer made 323.2 rupees a day in 2022, and would earn a monthly income of around 6500 rupees if he worked for 20 days in a month. If the household were to be supported by another earner, 78% of their cumulative monthly incomes would be dedicated towards preparing vegetarian thalis two times a day throughout a month.
This logically implies that money spent on other expenses like education, health, clothing, travel and energy utilities cannot take more than 22% of the two worker’s combined monthly income. compromises would need to be made across all fronts, with households having to make do with less richer and lower quality daily meals to lessen the burden of food expenses on the family budget.
Inflation and “Thalinomics”
While a “thali” literally translates to a plate, in the Indian culinary sense it usually refers to a kind of meal which involves multiple side-dishes served in bowls and paired with flatbreads like rotis, naans or puris on a platter. For the purposes of the study, Crisil assumed a veg thali to consist of roti, vegetables (onion, tomato and potato), rice, dal, curd and salad. A non-veg thali had nearly all of the same constituents, but the dal is replaced by a chicken side-dish.
According to the study, prices deemed to be common in north, south, east and west India were used to provide an estimation of the average price of preparing a thali at home. By monitoring monthly changes of these specific prices, one can gain a better insight on how inflation impacts the general public and their spending, also referred to as “Thalinomics“. Rather than focusing solely on the prices of main ingredients like cereals, pulses, vegetables and meat, the data also included the prices of spices, edible oil and cooking gas which were also identified as influencing changes in the price of a thali.
The report also provided a dissection of the increase of 24.26% in the price of a vegetarian thali, in which 21% can be attributed to the spike in tomato prices, going up by 176% compared to last year, from a price of Rs 37/kg to Rs 102/kg this August. Onions also cost 8% more, chillies were pricier by 20% and cumin was 158% more expensive than last year, contributing to 1% of the overall increase in the cost of a vegetarian thali.
Going from green to red, Crisil noticed that the increase in price for the non-veg thali was more relaxed, as meat, which predictably makes up more than half of the cost, saw a modest bump of 1-3% through the year. Vegetable oil was actually cheaper by 17% compared to its price in August 2022, and 14% in potato prices tempered the overall costs of both thalis to a relative degree.
Greener pastures ahead?
Despite the worrying statistics, brighter prospects lie ahead, says Crisil. Tomato prices have relaxed from their upward trajectory, getting cut in half to Rs 51/kg from July 2024. A 14.2 kg LPG cylinder would cost Rs 903 in September, taking a cut of Rs 100 from last month, applying some balm to inflation bruises suffered by Indian consumers.
However, the respites might just be minor, as Crisil doesn’t expect inflation in food prices to simmer down drastically anytime soon. While retail inflation has dropped down to 7% in August, compared to the 15-month high of 7.44% reached in July, mostly due to tomatoes becoming cheaper, the inflation rate is still miles above the 4% line that the RBI deems as “comfortable”.
Aastha Gudwani, an economist at the Bank of America Securities, described these price fluctuations as seasonal, as a result of analysis of 12 such episodes from FY2010. Every two years there’s an increase in the prices of potatoes, while tomato prices soar high every summer, thus shocks over vegetable prices are not a novelty in India. She noted, however, that the length of these episodes differed, the one in 2010-11 lasting 61 days, while the duration of great fluctuation in tomato prices was 142 days in 2016-17.
Given the relatively fleeting nature of such cycles, RBI has largely held back from interfering, the report said. Out of the 12 instances, RBI has changed the policy rate only 6 times despite inflation records being shattered.
